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Weeks after GameStop’s business frenzy, the company posted quarterly results and lost Wall Street estimates.
But the mostly brick-and-mortar video game retailer also named former Amazon and Google executive Jenna Owens as its new chief operating officer.
And, in an indication of the transformation that enthralled some investors on equities, the company said global e-commerce sales rose 175% last quarter and accounted for more than a third of its sales during the year. period.
GameStop shares appeared 3% the day after trading after trading.
During the period ended January 2021, GameStop earned $ 1.34 per share with revenue of $ 2.122 billion. Wall Street expected GameStop to report earnings per share of $ 1.35 in revenue of $ 2221 million, according to the Refinitiv average of the six analysts covering GameStop.
This marks GameStop’s first adjusted quarterly profit since the fourth quarter of 2020. GameStop’s fourth-quarter earnings are usually the company’s most annual earnings, driven by holiday sales.
Sales at the same GameStop store increased 6.5%.
“We are off to a strong start in 2021, as comparable February sales in stores rose 23%, led by the continued strength of global hardware sales. As we move forward, we are excited about the opportunities we face as we begin. to prioritize a lot Start digital and e-commerce initiatives as we continue to run our core business during this emerging console cycle, ”GameStop CEO George Sherman said in the earnings version.
Tuesday’s gains mark GameStop’s first quarterly report since GameStop’s trading craze in January.
In January, a small epic stock of GameStop stocks shocked Wall Street and drew attention to a new class of retail investors on social media platforms like Reddit. GameStop’s stock price soared to $ 483 per share and subsequently lost 90% of its value. The controversy caught the attention of Wall Street and Washington.
Since the rise and fall of GameStop in January, shares have continued to rise, with shares up nearly 70% this month. GameStop shares rose more than 860% in 2021.
GameStop has a market capitalization of about $ 14 billion, more than ten times the market value of $ 1.3 billion the stock market had at the end of last year. A year ago, GameStop’s market capitalization was $ 245 million.
GameStop shares have traded positively in the company’s new developments over the past five months, such as the appointment of Chewy co-founder Ryan Cohen to the GameStop board and a focus on GameStop’s technology and e-commerce transition.
Earlier this month, GameStop announced it was taking advantage of Cohen to lead its shift toward e-commerce. Cohen serves as chair of a special committee formed by the GameStop board to help with its transformation. Board members Alan Attal, former chief operating officer of Chewy, and Kurt Wolf, investment director of Hestia Capital Management, are also on the committee.
The committee has already appointed a chief technology officer, hired two executives to direct customer service and e-commerce compliance, and has begun looking for a new chief financial officer with experience in technology or e-commerce. GameStop previously announced that current CFO Jim Bell will resign on March 26th. Citing sources familiar with the matter, Business Insider reported that Cohen was expelled from Bell.
GameStop said Tuesday that its general manager of customers, Frank Hamlin, will step down.
Analysts are looking for more details on the cost, timing and benefits impact of GameStop’s investment plan. In addition, investors are looking for feedback from GameStop’s leadership team on the January trading craze.